Exam 2: Scarcity and the World of Trade-Offs

-In the above figure, moving from producing 50 guitars and 50 ukuleles to producing 25 guitars and 75 ukuleles, the opportunity cost of one ukulele is

International trade between two nations increases the standard of living of both nations due to

A country that must reduce current consumption to increase future consumption possibilities

The principle of comparative advantage implies that

A graphical representation which shows the trade-off that occurs when more of one output is obtained at the sacrifice of another is called

The value of the best alternative sacrificed to obtain something you want is referred to as

-Refer to the above figure. Which one of the following statements is TRUE with regard to the economy depicted in the graph?

"Economics deals with human needs." Do you agree or disagree? Why?

Which of the following statements is FALSE?

-Refer to the above figure. Which of the following would allow society to move to point d?

Which of the following is a TRUE statement?

The law of increasing additional costs is due to

Scarcity

Bonnie is a self employed. She makes floral arrangements in a building she rents. She owns the delivery vehicle and has hired a delivery driver. She is an example of

-Refer to the above figure. Which of the following points indicates an efficient use of resources?

Scarcity arises because

When an economy is operating efficiently, which is TRUE?

How can the concepts of opportunity costs, scarcity and choice be illustrated by the production possibilities curve?

Why does the trade-off between consumption goods and capital goods represent a trade-off between the present and the future?

A straight-line production possibilities curve has